Richard was very indulgent and paid little attention to his health. He went out on shopping sprees that he and Monica couldnt afford. He was overweight. He used alcohol excessively and smoked. His doctor had warned him of his unhealthy habits including a high cholesterol level, which placed him at risk of a major illness. His work output was excellent, but he often got into verbal arguments with superiors. The result was a reputation as a brilliant but unsteady worker who shifted from job to job often.

Monica was a vegetarian who exercised regularly. Her doctor told her she had the physical condition of a woman 10 years younger. Given Richards erratic behavior, one would think Monica would be under great stress. When I posed that question to her, she said that she had learned to cope with Richards behavior.

The couple had no life insurance except for a policy providing one times Richards salary at work. Monica had often asked Richard to get some additional insurance. His reply was that they did not have enough money. Monica specifically requested that I look at term and whole life insurance and tell her the type and amount of insurance that was appropriate.

Richard and Monicas insurance policies are summarized below:

Medical coverage was adequate.

Auto insurance was at the minimum level for the state of $50,000 to $100,000 per accident.

Homeowners insurance was at a level of 50 percent of replacement cost for the house. They had a 90 percent co-insurance clause.

Richard had no disability coverage.

A note saying that Richard didnt want long-term care insurance, but Monica was interested in looking at it.

What recommendation would you make to improve the couple's risk profile?